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Richard Curtis on
Publishing in the 21st Century

by Richard Curtis

PART TWO
PAPERBACKS: THE TAIL THAT
WAGGED THE DOG

(first published in Backspace
http://www.bksp.org)

For many publishing people, the world as they had known it ended in the summer of 1996. On a warm brilliant day I sat down at a table in a Spanish restaurant for what I thought would be a typical lunch with the publisher of a mass-market paperback company. I found him slumped head in hands over a seriously stiff drink.

“What’s the matter?”

He looked up, miserable. “You haven’t heard? The wholesale distribution business is imploding. Hundreds and hundreds of drivers have been let go.”

I groaned, beckoned to the waiter and pointed to my friend’s glass. “I’ll have the same.”

The collapse of the distribution system that fueled the mass-market paperback revolution was a trauma from which the book industry has not recovered to this day. To appreciate the impact of my friend’s announcement requires a brief description of the way books were distributed after the post-World War II paperback revolution that swept the U.S. publishing industry.

Hardcover vs. Paperback Distribution

By way of contrast, trade or “general interest” hardcover books are offered to bookstore buyers by publishers’ sales representatives. The store buyers select which titles they order and the number of copies they will stock in their stores. Though released year-round, hardcovers are offered on a seasonal basis in publishers’ catalogues issued several times annually. Whatever the reality may be, the theory is that they will have a decent shelf life and if popular may remain on display for months or longer. This business model has not changed fundamentally from the last century to the present time.

Mass-market paperbacks (as opposed to the larger “trade paperback” format) are a very different matter. Introduced in 1939, “pocket books” took hold in the ‘50s and ‘60s, but publishers soon realized that the hardcover distribution approach didn’t work. They needed a different sales model and turned to the one used for magazines.

Every month, magazines were shipped to depots – “agencies” – around the country. Drivers picked up the magazines at the agencies and visited stores on pre-assigned routes in towns and cities. Most of the stores were not bookshops but rather supermarkets, candy stores, newspaper stands, and bus, train or airport terminals. Each month, these salaried employees collected the previous month’s unsold publications and replaced them on the store’s racks and shelves with new stock.

To paperback book publishers, this existing distribution network was the perfect vehicle for delivering their product to a far-flung readership. Thus it came to pass that paperbacks began hitching rides with magazines. And that too is how they came to be released on a monthly schedule. After 1956, when the leading magazine wholesaler went out of business, a number of entrepreneurs set up shop as independent wholesale distributors (“ID’s” or “rack jobbers”), handling mostly books.

Because they were a monthly phenomenon, paperbacks did not enjoy a long shelf life; the exigencies of returning paperbacks, when the distributor cleared the racks to make room for the next month’s releases, made for an ephemeral existence. What is more, the unsold copies were usually not redistributed or remaindered. Because paperback publishers had to pay freight for returned copies, many of which were dirty or damaged, the stores found it more efficient simply to strip the covers off the unsold books, send the insides to be pulped, and return only the covers to the publishers for credit when settling accounts.

Since paperbacks were returnable, distributors delayed paying publishers until unsold stock was returned. To account to authors for the gap between copies sold and royalties released, the paperback publishers took a page from the creative accounting systems devised by the hardcover industry, holding large amounts of royalties for long periods until returns were finalized. Royalty reports to authors were deliberately fashioned to omit information about the number of copies printed, shipped, and returned, or about the amounts of royalty reserved pending finalization of returns. This suppressing of vital sales data gave publishers carte blanche to retain royalties that might have been remitted to authors. Some publishers got too creative and held royalties forever. Until the 1990s, when pressure from agents and from writers’ organizations forced publishers to reveal significant details, mass-market houses reported only net sales with no information as to how they arrived at those net figures. As I wrote at the time, it was like reporting batting averages to baseball fans without revealing how many at-bats or hits the players had had.

The Paperback Industry Blossoms

Unlike retailers of hardcover books, paperback booksellers seldom had much say over which titles were stocked on their racks. They passively received the current month’s selection and passively watched the unsold stock loaded into the distributor’s vehicle a month later. The authors of those books watched the process too, but some of them figured out ways to influence the wholesalers to promote their books. A number of leading authors, on their own initiative or sponsored by their publishers, began visiting the wholesale agencies and pitching their books at executives and ingratiating themselves with the jobbers. Some of the more energetic writers went so far as to drop in on drivers as they loaded their vehicles, bringing coffee and donuts and promotional material to inspire them. This technique was particularly successful with romance fiction, which sold most abundantly in the supermarkets that women visited two or three times every week. It did not hurt if the authors were attractive. Many a lovestruck driver stocked extra copies of a title after a pretty novelist shared a pre-dawn breakfast with him on the tailgate of his station wagon.

Although a growing number of traditional bookstores stocked mass-market paperbacks, it was the wholesale distribution network that fueled the huge growth of the book business in the last quarter of the twentieth century, spawning a thriving industry and a generation of bestselling authors. Even when those authors graduated to hardbacks, paperback reprints of their books drove sales overall. In the late 1980s and early ‘90s, mass-market paperback revenue made the difference between feast and famine for hardcover publishers. Income from romance fiction alone contributed 25% of the cash flowing into the trade book industry.

Smart publishing executives recognized how heavily they depended on mass-market income for their profits. But that message did not always filter down to their editors. Many of them, possessing only a hazy idea of where the money for their acquisitions came from, spent profligately and ended up taking a bath on books and authors that flopped miserably. Or they simply acquired whatever they pleased without giving much thought to the bottom line, failing to realize that they were indulging in a luxury largely subsidized by paperback book revenue. Many lived in denial that their beloved first novels, short story collections, poetry anthologies and other elevated forms of literary endeavor were financed by romances, westerns, thrillers, horror novels and space operas.

Efficiency Strikes the Distribution Business

Meanwhile, the infrastructure of paperback book distribution was undergoing significant changes. The dramatic rise and expansion of bookstore chains like Barnes & Noble siphoned business away from wholesalers’ franchises, both in cities and suburban malls. Computerized sales information enabled publishers, wholesalers and retailers to better track the performance of categories and identify winners and losers among specific books and authors. And the stunning advent of amazon.com leveraged the awesome power of the Internet to link supply and demand.

Assessing these patterns, paperback distributors began asking themselves why they needed to employ human labor when they could more efficiently and economically service bookstores and other outlets by shipping books directly to the retailers. Yes, it would mean that the human element -- the guy in the station wagon who knew which towns loved historical romances and which preferred contemporary ones, which adored westerns and which were big on science fiction – would be removed from the equation. But -- well, that was progress!

The big agencies pulled the plug in that summer of 1996 when whole fleets of drivers were discharged, and in the following years the wholesale distribution workforce was reduced to a fraction of what it had been in its heyday.

The Bottom Drops Out

Most publishing executives were slow to recognize the implications of the nosedive in the wholesale paperback distribution business, dismissing it as one of those occasional and inevitable shifts to which the industry had always adapted. What was the big deal? Fewer romances and other genre novels would be published, wasn’t that all there was to it?

In fact, the consequences were nothing short of calamitous. The impact was felt in every sector of the publishing business, from what got written to what got published to what got read. It wasn’t long before customers in west Texas or Nebraska or South Carolina discovered that many books by their favorite authors were no longer being stocked in their local stores. When customers or store owners complained, they were told to take it up with the distributor – in Vancouver or some other far-flung location reachable only by an 800 phone number.

The Rise of the Airport Model

A key result of the shift in distribution patterns was the streamlining of the way retailers ordered books from publishers. Why pick and choose among thousands of titles that might sell only a handful of copies? Wasn’t it better to follow the formula that worked so well at airports, ordering only the top fifteen or twenty bestselling books by branded authors like Nora Roberts, Robert Ludlum, John Grisham and Stephen King?

As paperback publishers awoke to the new buying patterns, they were forced to choose between star authors and those whose sales performance fell below a minimum level. At first the triaging was restricted to marginal genres like westerns, but as the last decade of the twentieth century progressed the definition of “marginal” broadened to embrace every category of book that fell below an ever-stricter definition of commerciality, a process akin to the lowering of the bar in a limbo dance. Limbo indeed: authors who had made a living for years from sales of ten or fifteen thousand copies of their paperbacks were now being dropped by their publishers as the minimum sales quota increased to twenty or thirty thousand copies or more.

Like the men and women who distributed their books, a lot of authors were thrown out of work, and the grim truth finally dawned on publishing executives. It wasn’t just genre titles that were affected by the seismic shift in book distribution; paperbacks of every kind were being hit by the pullback.

“What are the Author’s Numbers? What is the Author’s Platform?”

As the publishing industry entered the twenty-first century, book industry executives began requiring editors to produce elaborate profit and loss projections and other corporate-style analyses of the potential viability of books and authors. What was the sales performance of previous books? Did they “sell through” satisfactorily or did returns cross the threshold of unprofitability according to the latest formulas devised by bookstore chain number-crunchers? The mantra of “The Bottom Line” was invoked ad nauseam at every editorial committee, and editors were constantly reminded, “We can only afford to publish hits. If you can’t project a big profit on a book, turn it down.”

Editorial financial projections were aided by an Orwellian innovation called BookScan, instituted early in 2001 by Nielsen Broadcast Data Systems, the world's leading provider of airplay tracking information for the entertainment industry. BookScan offered subscribing publishers weekly analyses of sales by most major book retailers. Within moments, editors could access vital sales statistics on previously published books and authors, elevating performance parameters over traditional but less quantifiable values like compelling storytelling or stirring prose.

And what about the author? Was he or she attractive and mediagenic? Did he or she have a “platform” – an organizational base such as a hit television series or chain of fitness centers capable of promoting the sale of books? Was the author willing to buy large quantities of books for giveaway or resale by his or her franchise?

More and more, the importance of traditional literary criteria took a back seat to “The Numbers” and “The Platform.” Promising but modestly successful novelists discovered they could not get their second or third books published, and aspiring newcomers could not sell their books at all. As for nonfiction, no matter how compelling the memoir or business guide or social commentary might be, publishers were disposed to reject it because the author was not “branded.”

Faced with these grim options, authors resorted to increasingly frenzied measures to get published. Established novelists wrote under pennames to disguise the poor performance of their earlier books, or strove to produce blockbuster “breakout” novels long on sex, violence, and plot but short on craft and characterization. Without supportive publishers to carry them while they developed their talents over four or five books, new novelists focused on gimmicky concepts with “log lines” that could be pitched like movie scripts. Nonfiction authors plumped up their credentials or hired public relations specialists to burnish their images and enhance their media exposure. Others subsidized the purchase of large quantities of their own books to drive up their “numbers.” Literary agents were besieged by writers frantically seeking the advantage of representation by successful dealmakers. Self-publication soared, especially as electronic and print technology and Internet promotion brought the costs of vanity books down to proletarian levels.

As a shrinking marketplace combined with the pressure to publish books profitably, a sort of Boyle’s Law came into play. Those familiar with this physical principle know that such conditions accelerate molecular activity and produce heat, an apt metaphor for the growing anxiety among authors and editors.

And that brings us to today.

What options do authors, agents and publishers have under the circumstances described in these articles? What strategies must they employ to navigate between the ever-narrowing choices in the traditional publishing landscape and the almost infinite ones in the emerging world of virtual publishing? In the final installment of this series, we’ll examine the conditions under which the game must be played if literary endeavor is to continue fulfilling its mandate to inform, enlighten and entertain. In particular we will focus on the roles of “gatekeepers” in the publishing process -- editors, agents, bookstore buyers, reviewers and critics – who separate gold from dross in our literature. If those roles are being “disintermediated” by the forces I’ve described, and the filters between writer and reader continue to be dissolved, who is going to decide what we read?

Read Part One of this Series | Read Part Three of this Series | Discuss

All the best,

Richard Curtis

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